U.S.officials and friends of Chen Guangcheng were stunned by reports Wednesday morning that the blind Chinese human rights activist said he was coerced into leaving the protection of the U.S. embassy in Beijing and is seeking asylum in the U.S. with his family.

Chen told the Associated Press that U.S. officials relayed threats from the Chinese government that his wife would be beaten to death if he did not leave the embassy – an account the State Department vehemently disputes. “At no time did any U.S. official speak to Chen about physical or legal threats to his wife and children,” State Department spokesman Victoria Nuland said in a statement. “Nor did Chinese officials make any such threats to us.”

Chen’s interviews with foreign media from his Beijing hospital bed have complicated a delicate and unprecedented diplomatic deal, orchestrated by Chinese and American officials over the last three days, that saw Chen leave the embassy on Wednesday morning after six days under U.S. guard. “I was there. Chen made the decision to leave the Embassy after he knew his family was safe and at the hospital waiting for him, and after twice being asked by [U.S. Ambassador to China Gary] Locke if he was ready to go,” said Kurt Campbell, the Assistant Secretary of State for East Asian and Pacific Affairs, who flew to Beijing over the weekend to handle the negotiations. “He said, ‘zou,’ – let’s go. We were all there as witnesses to his decision, and he hugged and thanked us all.”

The State Department is scrambling to clarify the events leading up to the departure after Chen’s stunning allegations. “U.S. interlocutors did make clear that if Chen elected to stay in the Embassy, Chinese officials had indicated to us that his family would bereturned to Shandong, and they would lose their opportunity to negotiate for reunification,” Nuland said. “And at no point during his time in the Embassy did Chen ever request political asylum in the U.S. At every opportunity, he expressed his desire to stay in China, reunify with his family, continue his education and work for reform in his country. All our diplomacy was directed at putting him in the best possible position to achieve his objectives.”

Nuland’s comments were backed up by Jerome Cohen, a longtime China legal expert who had advised Chen, a self-trained legal activist, during his 2005 detention for advocating on behalf of women forced to undergo abortions and sterilizations in his province of Shandong. Chen was found guilty of “disturbing traffic” and “destroying property” in 2006–an unusual charge against a blind man who’d been under house arrest since 2005–and Chen and his family were subjected to house arrest and frequent beatings since then. Cohen said he joined negotiations by phone on Monday at Chen’s request as “the only person he could trust,” to act as Chen’s personal advocate in the talks spearheaded by Campbell and Harold Koh, the State Department’s legal counsel.

In unprecedented diplomatic negotiations with the Chinese starting Monday, Cohen and his colleagues laid out Chen’s options. He could leave and seek asylum in the U.S. while his wife and daughter would likely remain under house arrest in Shandong, or he could choose to stay in China. If he chose the latter, U.S. negotiators would seek assurances from the Chinese government that Chen and his family would not return to the abusive circumstances under which they lived for the last seven years. Cohen advocated a middle path to Chen, based on a deal forged by Chinese activist Ai Weiwei, with whom Cohen has also worked. Chinese officials released Ai from detention last June after 81 days and allowed him to travel freely within Beijing; he recently gave a Skype speech to hundreds of supporters. “Though this solution has caused some problems for the government, they have tolerated it because they know it’s better than the international condemnation of locking him up. Ai is showing a kind of path we are trying hard to create, a space between prison and total freedom,” Cohen told reporters on a call sponsored by the Council on Foreign Relations. “That’s a kind of precedent I’ve talked to Chen about.”

Chinese negotiators offered to allow Chen to study law – a long-standing request – at one of seven universities that also have blind institutions – none in Beijing or Shanghai, though two in nearby cities. He would be treated as any other law student, they said, and his family could live with him. His wife, who also has an avid interest in law, reads aloud to Chen. “What restrictions he’ll be under in terms of talking to friends, making public statements, writing an opinion on one legal ruling or another remains to be seen,” Cohen said. “We want to see this new experiment this daring experiment with China succeed.” Koh, Campbell and Cohen sought assurances not just from China’s Foreign Ministry, which, Cohen said, has relatively weak powers within China, but also China’s national and secret police. They also made it a condition that Secretary of State Hillary Clinton and President Barack Obama personally back the deal so as to make it more difficult and embarrassing for China to reneg. Cohen said the talks were exceptional in nature. “This isn’t 1989. Our bargaining position isn’t as strong as it was when Fang Lizhi went to the U.S. embassy,” he said. “This is one of the most daring diplomatic arrangements we’ve ever seen with U.S.-Chinese relations. We think it’s the best option and so does Chen.”

At least Chen did when Cohen last spoke with him on Tuesday. Cohen said that on Monday night, Chen was undecided and fretful for his family. “I’m very, very fearful. I’m very, very insecure. I’m very uncomfortable,” Cohen said Chen told him on Monday. But throughout the talks, Chen maintained that he wanted to remain in China, according to Cohen and U.S. officials, because he didn’t want to live without his family and felt he could achieve more in China. “Chen is brilliant and to accept asylum and fade away, that wasn’t an appealing option,” Cohen said. “He wants this. He told me in the conversations we had in the last couple of days that he wants the rights of any other citizen.” By Tuesday, Chen was feeling better about the arrangement and by the time he left the embassy he was comfortable with it, Cohen said.

The reports that Chen now feels coerced took many U.S. officials by surprise. Cohen said that while Chen never told him that anyone threatened his wife, Cohen heard from a friend of Chen’s wife on Wednesday morning that local authorities in Shandong had threatened to beat her to death if her husband left the country. Chen told the AP he heard this threat from U.S. officials, but U.S. officials say they had no knowledge of that threat and did not relay it to Chen. “What could’ve happened when he got to the hospital and met his family his wife told him what had happened and that might have made him regret thedecision,” Cohen said. “He may be very susceptible. Here’s a man who’s had a very skewed perspective, living under a lot of abuse for many years.”

“I think the saddest outcome would be if events transpired now that put Chen at war with the U.S. government that represents his only secure support,” Cohen said. “It could easily happen through confusion, through confusion being sown that would create distrust between him and the U.S., and then he would just be out there and that would be very, very unfortunate.”